I am reviewing the commercial loans and have what could be a dumb question but, HMDA allows H|E LOC to be reported at the bank's option and we have decided not to report these loans.

My question is if we have a commercial loan that is to obtain a LOC for improving an apartment building would this need to be reported or would these be considered a H\E LOC???

All LOCs are optional reporting.

Is that a positive? I wish they had a separate manual for commercial loans and what aspects of the regulations apply to them.

I attended a seminar from Professional Bank Services and I asked them the question: Commercial Line of Credit, for home improvement on a rental property....is it reportable? and they said Yes it is. The only optional reporting LOC's are HE LOC which are defined as consumer purpose and since this is business purpose it is reportable???? Where in the reg does it say you don't have to report LOC's she asked? It only states HELOC's are optional.

Don't you hate when you get two different answers....time to ask the examiners.

1. A HELOC is an open-end loan secured by a dwelling. Rental property is a dwelling.

2. An unsecured LOC would have to be classified as HI to be reportable.

I've been dealing with HMDA off and on since 1991. All institutions I have worked at have never reported ANY line of credit and none have been cited or criticized for not doing so.

That's what I am leaning towards since we haven't reported them in the past. They decided this year to report them and I am not quit sure why all of a sudden they changed, but it made me think too much about something I thought I knew. Thanks for the advice.

Well, my examiners seem to be stumped on this question and had a discussion with the higher ups in the FDIC and they too are stumped, so they told me to e-mail HMDA help and see what they have to say. Now I am really confused since my examiners don't even know what the answers are.

Our OCC examiner was clear when it came to refinancing commercial LOC's - report them -

I took this up with HMDA help because the use of the term "line of credit" can mean an open end or a closed end line. They confirmed that open end credits are optional. Closed end are reportable if they meet all the other criteria (purpose and/or definition) and are not temp loans.